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Rent on commercial purpose

15 February 2024

A shop is given on rent for commercial purpose at 45000/- per month rent paid.
tenant is registered person and landlord is unregistered.
what is the gst and TDS provision applied on it.
please clarify.

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4 Replies

sabyasachi mukherjee (26073 Points)
Replied 15 February 2024

Invoices are raised of not.

Deeptha Srinivasa Ragavan (Article Assisstant) (218 Points)
Replied 15 February 2024

It is subject to TDS under section 194I since it crosses threshold limit of Rs.2.4L. Also if the payee is unregistered it is subject to GST under reverse charge mechanism.

CA Rashmi Gandhi (Chartered Accountant) (86225 Points)
Replied 15 February 2024

GST under RCM applicable only if residential building provided for commercial purpose. So , GST not applicable in your case.

As the total rent is Rs 540000, TDS @ 10% deductible u/s 194I if you are audited u/s 44AB

Saravanan nagaraj (463 Points)
Replied 15 February 2024

As per the Goods and Services Tax GST Act, if an individual rents out a property to a business entity for commercial purposes, the landlord is required to register for GST if their annual rental income exceeds the threshold limit of Rs. 20 Lakhs.

As per Income Tax, you should declare your Income as Income from business and professional. Not under income from House Property.

As you are unregistered person in GST, raise Invoice without GST. Just follow the invoice format. Issue to your tenant.

As a registered person, Tenant(he) makes payment against that invoice. Then, you can give receipt against his payment for Income Tax purposes.

Tax audit limit under 44AB, 2cr.